NHR – Non Habitual Resident
NHR Status Request Assistance
Status Request Assistance
The Non Habitual Resident status aims to attract professionals who perform high value-added activities or intellectual property, who are not resident in Portugal, and also those who receive pensions obtained abroad. The status was approved in 2009 and, in order to benefit for 10 consecutive year, you must be considered a resident under Portuguese law and not have been taxed as a fiscal resident in Portugal in the five years preceding the application for the statute. The previous condition applies both to foreign citizens and to nationals who are living outside the country and wish to return to Portugal.
How to request?
The status of non-habitual resident can be requested by a taxpayer who, at first, must guarantee that he/she is registered as a resident in Portugal, either by fiscal authority or by tax office at the “Loja do Cidadão”. Once the taxpayer has registered, he/ she may apply for non-habitual resident status.
This request must be made by 31st. of March of the year following that in which the taxpayer became resident in Portugal. According to the documentation available on the Finance/Fiscal Portal, in order to be able to make the application for the statute, taxpayers must make an application addressed to the Director of Registration Services of taxpayer, which can be delivered to any finance/fiscal service.
Please note that in order to be considered a resident in Portugal; you must stay more than 183 days in Portuguese territory.
Another possibility is to own a house, that is intended to maintain and use it, as usual residence.
What are the tax advantages?
In addition to other advantages, the status of Non-Habitual Resident brings with it some tax benefits that you can enjoy/appreciate.
Firstly, these benefits vary according to the type of income that a given taxpayer earns. For example, taxpayers who have income in Portugal from employment or/and self-employment may enjoy a lower rate of IRS, in this case 20%. However, this rate reduction does not apply to all workers. Thus, it only applies to taxpayers who have high value-added activities. Therefore, taxpayers who work as doctors, architects, psychologists, teachers, among others, will be able to enjoy this benefit. The list of activities can be found in the ordinance no.230/2019.
For taxpayers who have obtained income from employment or/and self-employment abroad, the tax exemption method is applied in Portugal. This means that these taxpayers do not pay tax in Portugal, as long as they are taxed in another country. In addition, they are also considered if they are covered by other criteria laid down by law. Thus, it means that these taxpayers do not pay tax in Portuguese territory, as long as they are subject to taxation in another country. In addition, they are also considered if they are covered by other criteria provided by law.
If the taxpayer is a foreign pensioner, who is receiving his retirement through another country, then exactly the same method of tax exemption is applied in Portugal. This is subject to compliance, of at least one of the requirements set out below:
• Be taxed in the other Contracting State, provided there is agreement between the two States, to prevent double taxation;
• When, by the criteria presented in nº1 of articleº18 of the CIRS (Tax Code on Personal Income), the income should not be considered as obtained in Portugal.
However, it is worth remembering that, with the approval of the State Budget for 2020, Law nº. 2/2020 of 31st. of March, the net pension income is now taxed at the rate of 10% – when it is not taxed in the contracting country through a Double Taxation Agreement signed between Portugal and that same country.